Lee Furniture Company manufactures office chairs. The 2020 operating budget is based on sales of...
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Accounting
Lee Furniture Company manufactures office chairs. The 2020 operating budget is based on sales of 50,000 units at $65 per chair. Budgeted variable costs are $40 per unit, fixed costs are $800,000, and operating income is projected to be $450,000. Regarding actual results, 54,000 units were sold at $70 each, actual variable costs were $38 per unit and fixed costs were $750,000. Resulting in 2020 actual income of $978,000.
Required: Prepare a variance analysis report with both flexible-budget and sales-volume variances.
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